Correlation Between FIDELITY BANK and CUSTODIAN INVESTMENT

Can any of the company-specific risk be diversified away by investing in both FIDELITY BANK and CUSTODIAN INVESTMENT at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining FIDELITY BANK and CUSTODIAN INVESTMENT into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between FIDELITY BANK PLC and CUSTODIAN INVESTMENT PLC, you can compare the effects of market volatilities on FIDELITY BANK and CUSTODIAN INVESTMENT and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in FIDELITY BANK with a short position of CUSTODIAN INVESTMENT. Check out your portfolio center. Please also check ongoing floating volatility patterns of FIDELITY BANK and CUSTODIAN INVESTMENT.

Diversification Opportunities for FIDELITY BANK and CUSTODIAN INVESTMENT

0.38

Correlation Coefficient

FIDELITY BANK  CUSTODIAN INVESTMENT

Weak diversification

The 3 months correlation between FIDELITY and CUSTODIAN is 0.38. Overlapping area represents the amount of risk that can be diversified away by holding FIDELITY BANK PLC and CUSTODIAN INVESTMENT PLC in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on CUSTODIAN INVESTMENT PLC and FIDELITY BANK is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on FIDELITY BANK PLC are associated (or correlated) with CUSTODIAN INVESTMENT. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of CUSTODIAN INVESTMENT PLC has no effect on the direction of FIDELITY BANK i.e., FIDELITY BANK and CUSTODIAN INVESTMENT go up and down completely randomly.

Pair Corralation between FIDELITY BANK and CUSTODIAN INVESTMENT

Assuming the 90 days trading horizon FIDELITY BANK PLC is expected to under-perform the CUSTODIAN INVESTMENT. But the stock apears to be less risky and, when comparing its historical volatility, FIDELITY BANK PLC is 1.36 times less risky than CUSTODIAN INVESTMENT. The stock trades about -0.05 of its potential returns per unit of risk. The CUSTODIAN INVESTMENT PLC is currently generating about -0.03 of returns per unit of risk over similar time horizon. If you would invest  4,075  in CUSTODIAN INVESTMENT PLC on September 13, 2025 and sell it today you would lose (375.00) from holding CUSTODIAN INVESTMENT PLC or give up 9.2% of portfolio value over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Very Weak
Accuracy	98.44%
Values	Daily Returns

FIDELITY BANK PLC  vs.  CUSTODIAN INVESTMENT PLC

FIDELITY BANK PLC

Risk-Adjusted Performance

Weakest

Over the last 90 days FIDELITY BANK PLC has generated negative risk-adjusted returns adding no value to investors with long positions. In spite of latest weak performance, the Stock's fundamental drivers remain stable and the newest uproar on Wall Street may also be a sign of mid-term gains for the firm private investors.

CUSTODIAN INVESTMENT PLC

Risk-Adjusted Performance

Weakest

Over the last 90 days CUSTODIAN INVESTMENT PLC has generated negative risk-adjusted returns adding no value to investors with long positions. Despite fairly strong basic indicators, CUSTODIAN INVESTMENT is not utilizing all of its potentials. The current stock price confusion, may contribute to short-horizon losses for the traders.

Pair Trading with FIDELITY BANK and CUSTODIAN INVESTMENT

The main advantage of trading using opposite FIDELITY BANK and CUSTODIAN INVESTMENT positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if FIDELITY BANK position performs unexpectedly, CUSTODIAN INVESTMENT can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in CUSTODIAN INVESTMENT will offset losses from the drop in CUSTODIAN INVESTMENT's long position.

The idea behind FIDELITY BANK PLC and CUSTODIAN INVESTMENT PLC pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.